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What is the Considered the Good Price-To-Book Ratio? – Definition, Basics

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Price-to-Book Ratio Definition

The price-to-book ratio (PBR) takes favor by value investors for decades, and it widely uses by market analysts.

And traditionally, any value under 1.0 considers the good P/B value, indicating the potentially undervalued stock.

However, value investors often consider stocks with a P/B value under 3.0. It’s important to note that it is challenging to pinpoint the specific numeric value of the “good” P/B ratio.

When determining if the stock undervalues and, therefore, the right investment, ratio analysis can vary by industry, and the good P/B ratio for one industry the low rate for another.

What are the Basics of the Price-to-Book Ratio?

How to Calculating the P B Ratio Example

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